Teachers and unions

This is some information on unions that might be of interest to you since teachers are under attack in several states. General Motors is in the news because it has taken government money to survive and is now owned by the government and the union but GM is in some ways typical of other large corporations in that they all have large legacy cost. Legacy costs are the commitments made to employees in the form of retirement benefits which include among other things pensions and health insurance. Today GM has unfunded legacy costs of about 200 billion and the 600 million shares of outstanding stock can be purchased for 1.5 billion dollars. This is the culmination of 50 years of mismanagement. Many years ago the company president had a long term plan usually 10 to 20 years and his strategy was developed on that basis but in the early 60's things begin to change. The president's horizon shortened and over the next ten years it dwindled to planning for the next quarterly dividend. The pressure on CEO's mounted and they had to show a good dividend to keep investors happy. If the value of the dividend fell then investors looked for other vehicles in which to place their capital and the CEO's job was in jeopardy. This was highlighted when it came time to negotiate a new contract with the union and the result was to pacify the union members with increased benefits instead of increased salaries. This allowed the CEO's to avoid a strike and pushed off payment into the future and thus preserving the current dividend. By the time payments came due this CEO was on his way to either a higher paying position or to retirement. So here we are today with a company that has committed payments to its retirees that are worth 130 times more than the entire company is worth. What idiot would ever purchase a company in that position? Only the federal government could be that stupid. In the Minneapolis School District there are 3,300 teachers and 6,700 support staff. 1,500 of the support staff are members of the teachers union. If the teachers select a candidate who will negotiate contracts that are favorable to teachers and then work to get them elected, they have a very good chance of winning. If each teacher and spouse vote for a particular candidate that is 9000 votes. Now if they get their parents to vote that is another 18,000. Next if they have coffee parties and invite the neighbors plus make a small campaign contribution they can just about guarantee a win for their candidate. The proof of this is that No DFL-endorsed candidate for the board has lost in at least 20 years. Here are the results from the last school board election and it is easy to see why someone with a 27,000 vote head start will be the likely winner and you can be assured that all the teachers do vote. 3 seats 131 of 131 precincts (100%) Lydia Lee * 61,623 Jill Davis 58,998 Carla Bates 54,691 Sharon Henry-Blythe * 39,476 Kari Reed 33,118 Doug Mann 28,416 This is why it is necessary for there to be a disinterested third party to negotiate contracts. Some thing similar to arbitration